Digital Piracy (HSC SSCE Legal Studies): Revision Notes
Legal and Non-Legal Responses
Introduction to legal responses
Multiple legal mechanisms exist in Australia to protect copyright holders' rights in their creative works. Australia's copyright framework is complex, drawing from three main sources:
- Legislation – primarily the Copyright Act 1968 (Cth)
- International treaties – agreements on copyright protection across borders
- Case law – judicial decisions interpreting and applying copyright principles
These legal protections apply to the digital environment and enable copyright owners to pursue both civil action and criminal prosecution against infringers. Civil cases typically focus on establishing who infringed copyright and proving the offence occurred in a digital context. Criminal prosecutions, with penalties including fines and imprisonment, are generally reserved for large-scale commercial piracy operations.
Legislative protection in Australia
Constitutional basis and the Copyright Act 1968 (Cth)
The Australian Constitution grants the Commonwealth Parliament exclusive power over copyright matters under section 51(xviii). This makes copyright protection a federal responsibility.
Australia's primary copyright legislation is the Copyright Act 1968 (Cth). This Act replaced outdated UK-based law and consolidated existing copyright principles. Since its introduction, the Act has undergone numerous amendments to address evolving digital copyright issues. It is one of Australia's most extensive statutes, currently spanning 646 pages. Courts must interpret how the Act applies in varied contexts, meaning copyright analysis often requires examining both the Act itself and relevant judicial decisions.
Automatic protection system
Unlike countries such as the United States and Canada, Australia does not operate a government copyright registration system. Copyright protection is automatic – works receive protection immediately upon creation if they meet the statutory requirements, without any registration process.
Requirements for copyright protection
For a work to qualify for copyright protection under the Copyright Act 1968 (Cth), it must satisfy three criteria:
- Eligible subject matter – the work must be a type protected by copyright (e.g. musical work, artistic work, literary work)
- Original creation – the work must result from effort and proficiency, not copied from pre-existing material
- Fixed in tangible form – the work must be recorded or 'fixed' onto something physical (paper, tape, computer drive, digital storage)
Copyright notices and digital watermarks
While not legally required, many creators add a copyright notice to their work. This serves two purposes:
- Reminds users the work is copyright-protected
- Identifies who owns the copyright
Copyright notice: A notice added to a work to inform people of who owns the copyright and when the work was created (e.g. © Random Business Pty Ltd 2011).
For digital files containing copyright material (music, sound recordings, videos), labelling can be challenging. Copyright owners may embed a digital watermark within the file to ensure ownership information remains intact even when the file is copied or shared.
Major amendments to digital copyright protection
Since 2000, the Australian Government has amended the Copyright Act multiple times to keep pace with technological, social and economic changes. The most significant amendments include:
Copyright Amendment (Digital Agenda) Act 2000 (Cth)
This Act modernised the Copyright Act for the digital age by:
- Expanding the definition of 'communication' to include making works available online and transmitting them electronically
- Covering the technical processes used for digital transmission
- Introducing prohibitions on creating or distributing devices designed to circumvent technological protection measures
Technological protection measures: Tools or 'locks' that copyright owners use to prevent unauthorised copying or access to copyright materials (e.g. access codes, encryption, scrambling systems that require authorisation).
US Free Trade Agreement Implementation Act 2004 (Cth)
The Australia–United States Free Trade Agreement (AUSFTA) required Australia to align certain copyright laws with US standards and international treaties. Key changes included:
- Extending copyright duration from 50 years to 70 years after the author's death
- Limiting ISP liability for copyright infringements committed by their customers (Copyright Act 1968 (Cth) Part V, Division 2AA)
This limitation on Internet Service Provider (ISP) liability became a significant issue in later litigation.
Copyright Amendment Act 2006 (Cth)
This Act implemented further AUSFTA requirements and updated outdated technological provisions. Major amendments included:
- Criminal enforcement provisions – introducing on-the-spot fines for copyright infringement
- Space-shifting permissions – allowing copying of music from format to format or device to device for personal use
- Time-shifting permissions – permitting recording of broadcasts for later viewing
- Format-shifting permissions – enabling format changes of copyright materials for personal use (e.g. scanning photos to digital format, printing articles)
- Expanded technological protection measures – making it an offence to use devices designed to circumvent digital locks
Space-shifting: Transferring music or a sound recording from one format to another or from one device to another (e.g. copying music files from computer to portable player).
Time-shifting: Recording a television or radio broadcast for later viewing or listening.
Format-shifting: Copying books, journals, photos or videos from one format to another format (e.g. scanning a photo to digital format, printing a newspaper article).
Important limitation: Despite these amendments, many common uses of copyright material – such as downloading, uploading or sharing files containing copyright material via the internet or personal websites – may still constitute copyright infringement under Australian law.
Copyright Amendment (Online Infringement) Act 2015 (Cth)
This amendment addresses offshore piracy by allowing copyright owners to apply for court orders to block access to illegal offshore websites that exist primarily for copyright infringement purposes (i.e. using music, words and images without authorisation for advertising or distribution).
International treaties on copyright
International copyright treaties play a crucial role in protecting Australian copyright holders overseas and foreign copyright holders in Australia. These treaties ensure copyright protection across international borders and promote consistent approaches to copyright issues globally.
In Australia's legal system, international treaties must be incorporated into domestic legislation before they become binding. The most important treaty provisions are already enacted within the Copyright Act 1968 (Cth) or other relevant legislation. However, the treaties themselves remain significant for:
- Ensuring Australian works receive automatic protection in other treaty countries
- Protecting overseas copyright holders from infringement within Australia
- Establishing international standards for copyright protection in the digital environment
Key international copyright treaties
Australia is party to four major international copyright agreements:
- Berne Convention for the Protection of Literary and Artistic Works (accepted by Australia in 1928)
- World Trade Organization Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) (accepted by Australia in 1995)
- Australia–United States Free Trade Agreement (AUSFTA) (accepted by Australia in 2004)
- World Intellectual Property Organization Copyright Treaty (WIPO Copyright Treaty) (accepted by Australia in 2007)
These treaties establish reciprocal protection, meaning Australian works receive automatic copyright protection in most other countries, and works from most other countries receive automatic protection in Australia.
Civil law cases on digital copyright
The complexity of digital copyright law and the scale of file-sharing have generated numerous civil cases worldwide, particularly in the United States and Australia. These cases involve complex legal arguments about how copyright law applies to file-sharing technologies and where liability should fall for infringements using those technologies.
Napster case
A&M Records Inc. v Napster Inc., 239 F3d 1004 (9th Cir 2001) – United States
The first major legal battle over file-sharing began in 2001. Shawn Fanning, an 18-year-old, created Napster, one of the first internet services dedicated to sharing music and video files between users. The service operated through a central network where users could upload and download files.
Case Summary: Napster
Key facts:
- High-profile artists including Metallica and Madonna complained of copyright infringement
- Napster facilitated sharing of copyright-protected material on its central network
Outcome: The US Court of Appeals for the Ninth Circuit found Napster liable for copyright infringement. Napster was forced to change its service and business model to prevent users from infringing copyright.
Significance: This case established that file-sharing services could be held liable for facilitating copyright infringement, even if they didn't directly copy the material themselves.
Kazaa case
Universal Music Australia Pty Ltd v Sharman License Holdings Ltd [2005] FCA 1242 – Australia
Following Napster's demise, new file-sharing networks emerged. Kazaa, developed and distributed by Sydney-based Sharman Networks, became dominant. By 2004, Kazaa had been downloaded 319 million times globally.
Background: The Recording Industry Association of America (RIAA) launched aggressive litigation against individual Kazaa users, including a controversial lawsuit against a 12-year-old girl for US$150,000 per song. The case was eventually settled for US$2,000. By 2005, the RIAA had sued approximately 12,000 people. However, the main legal challenge focused on Sharman Networks itself.
Case Summary: Kazaa
Key facts:
- A consortium of 30 record companies, including major international labels, sued Sharman Networks
- Kazaa differed from Napster by not storing files centrally – it provided software enabling users to share files directly between themselves
- Most music files shared via Kazaa were copyright-protected
Court findings: The Federal Court of Australia found that:
- Most Kazaa music files were shared without copyright owners' permission
- Sharman Networks could have implemented technical measures to limit copyright infringement but chose not to
- Sharman profited from advertising revenue, which increased with more file-sharing activity
Outcome: The court allowed Sharman to continue distributing Kazaa software, but only if it adopted technical measures to prevent and discourage copyright infringement.
Significance: This case demonstrated that Australian courts would hold file-sharing service providers liable for facilitating copyright infringement, even when they didn't centrally store the infringing files.
iiNet case
Roadshow Films Pty Ltd v iiNet Ltd [2012] HCA 16 – Australia
This case tested the liability of Internet Service Providers (ISPs) for copyright infringements committed by their customers, with international implications for ISP responsibility.
Key facts:
- In 2008, 34 film companies commenced proceedings against iiNet, Australia's third-largest ISP
- The film companies alleged iiNet was liable for copyright violations by users downloading films via its network
- Australia had developed a reputation for high piracy rates, prompting international media organisations to pursue legal action
Court decisions:
- Federal Court (2010): Justice Cowdroy found iiNet was not liable for copyright violations by its users
- Full Court of the Federal Court: Upheld the decision (appeal unsuccessful)
- High Court of Australia (2012): Upheld the decision (final appeal unsuccessful)
High Court recognition: The judges unanimously recognised that:
- Copyright law had not kept pace with technological change
- Legislative change was required to address widespread P2P copyright infringement
- Over half of iiNet's internet service usage (by volume) involved BitTorrent file-sharing, known for infringing activities
- ISPs needed to play a more active role in preventing online copyright theft
Industry response: Following the decision, the Australian Federation against Copyright Theft (AFACT) stated:
- The outcome demonstrated that copyright law was inadequate for the online environment
- Government action was necessary to address unabated copyright infringement
- Australian law had fallen behind international developments in online copyright protection
Significance: This case highlighted the gap in Australian copyright law regarding ISP liability. While copyright owners lost the case, it prompted calls for legislative reform and influenced the Copyright Amendment (Online Infringement) Act 2015 (Cth).
Dallas Buyers Club case (2014)
This case represented a new approach to pursuing individual infringers through their ISPs.
Key facts:
- Lawyers representing producers of the 2013 film Dallas Buyers Club launched Federal Court action in 2014
- They sought customer details linked to IP addresses allegedly involved in unauthorised downloading via BitTorrent
- Dallas Buyers Club (DBC) sought damages for the film's cost and piracy detection costs
Counter-action: A group of ISPs led by iiNet opposed the application, arguing it could lead to speculative invoicing – where copyright holders send demanding letters threatening legal action unless substantial fees are paid for indemnity from lawsuits.
Court approach: The presiding judge required DBC's legal team to submit:
- A draft of letters to be sent to alleged infringers
- Telephone scripts for contacting ISP customers
- These materials had to be approved before customer details would be released
Status: At the time of publication, this case was ongoing.
Significance: This case, combined with the Copyright Amendment (Online Infringement) Act 2015 (Cth), signals that ISPs face greater legal responsibility for allowing customers to access file-sharing sites.
Criminal law cases on digital copyright
While civil litigation dominates copyright enforcement, the Copyright Act 1968 (Cth) also creates criminal offences for copyright infringement. Criminal provisions typically involve:
- Fines ranging from moderate to substantial amounts
- Possible imprisonment for serious offences
- Current focus on commercial-scale piracy for trade or profit
Though criminal prosecutions do not yet commonly target average computer users, several important cases illustrate the potential consequences of digital copyright infringement.
Jose Duarte (2007)
First Australian conviction for cinema recording
Case Summary: Jose Duarte
Key facts:
- In November 2007, Jose Duarte, aged 21, pleaded guilty in Sydney's Downing Centre Local Court
- He used his mobile phone camera to record The Simpsons Movie from a cinema screen
- He uploaded the recording to the internet
- The illegal copy appeared online within hours of the film's global release but before its US release
- Within two hours, the file had been downloaded approximately 3,000 times
Outcome:
- Criminal conviction recorded under the Copyright Act 1968 (Cth)
- Fine of $1,000
Significance: This case established that recording films in cinemas and distributing them online would result in criminal convictions, sending a deterrent message about cinema piracy.
Hew Raymond Griffiths extradition case
United States of America v Griffiths [2004] FCA 879
This high-profile case raised significant questions about international copyright enforcement and extradition for digital offences.
Background: Hew Raymond Griffiths, an Australian resident living modestly on the NSW Central Coast, was accused by the United States of leading an internet software piracy network called Drink or Die. The network specialised in:
- 'Cracking' copyright-protected software, movies, games and music by removing embedded protection codes
- Distributing the material free of charge (Griffiths received no money for his activities)
Extradition: The case is significant because it involved an Australian resident indicted by a court in Virginia, USA, for copyright infringement under US law, despite never travelling to the United States.
Extradition: The handing over of a person accused of a crime by the authorities of the country where he or she has taken refuge to the authorities of the country where the crime was committed.
Legal proceedings in Australia:
- Federal Court of Australia – US Government succeeded in extradition application
- Full Court of the Federal Court – Appeal unsuccessful
- High Court of Australia – Application for special leave to appeal refused
During the High Court proceedings, Griffiths was held in Australian custody.
Case Outcome: Griffiths Extradition
Outcome in the United States:
- February 2007: Griffiths extradited to the United States
- He pleaded guilty in Virginia court to criminal copyright infringement
- Sentenced to 51 months in US prison
- Sentence reduced to account for time served in Australian custody
- March 2008: Returned to Australia
Controversy: The extradition sparked debate in Australia:
Arguments against extradition:
- Griffiths could have been prosecuted in Australia for infringing Australian copyright law
- Extraditing someone merely because foreign businesses were affected seemed disproportionate
- The decision suggested inappropriate foreign influence over Australian sovereignty
Arguments supporting extradition:
- The decision represented an important step in enforcing international copyright protection
- It demonstrated serious consequences for international copyright infringement
- It upheld Australia's treaty obligations
Significance: This case highlighted the serious international consequences for digital copyright infringement. It established that:
- Australian residents can be extradited for copyright offences committed online
- International copyright protection will be enforced across borders
- Even non-commercial infringement on a large scale can result in criminal prosecution and imprisonment
Non-legal responses
Legal action against individual file-sharers presents significant challenges:
- Cost and time – pursuing cases is expensive and time-consuming
- Limited effectiveness – it is impossible to sue every individual infringer
- Questionable strategy – targeting ordinary consumers may be counterproductive
Consequently, copyright holders typically pursue legal action only against:
- Serial offenders (as a deterrent)
- Those profiting from copyright infringement through commercial operations
The market has been forced to adapt by offering legitimate alternatives to illegal file-sharing. These non-legal responses aim to meet consumer demand for convenient, affordable access to downloadable content.
Market and industry response
The growth of file-sharing technologies and portable devices (smartphones, iPhones, tablets) has been unstoppable. Rather than fighting this trend entirely through litigation, the entertainment industry has adapted by providing legal alternatives.
Key strategies for reducing piracy:
- Legal streaming and download services – offering convenient, affordable access to content
- Simultaneous global releases – reducing the incentive to pirate content not yet available locally
- Reasonable pricing – making legal access more attractive than illegal alternatives
The success of these market adaptations suggests that providing convenient, affordable legal alternatives may be more effective than litigation alone in reducing piracy rates.
iTunes
Launched in 2003 by Apple Inc. founder Steve Jobs, iTunes Music Store became one of the largest legitimate file-download services.
Business model:
- Struck deals with major record labels to offer authorised downloads
- Copyright owners receive payment for their material
- Users gain convenient, safe method of purchasing songs online
Expansion: The store has expanded beyond music to include:
- Television shows
- Films
- Radio content
- Software
- Digital books
Significance: iTunes demonstrated that legitimate digital distribution could be profitable for copyright holders while meeting consumer demand. Its success showed that market adaptation could be more effective than purely legal responses in addressing digital piracy.
Spotify
Launched in Australia in 2012, Spotify is a Swedish company offering a different approach to music distribution.
Business model:
- Internet streaming rather than downloads
- Free tier – ad-supported service
- Premium tier – subscription service with:
- No advertisements
- Offline listening capability
- Higher-quality audio
Compensation model: Rights-holders receive payment based on their percentage of total streams.
Criticism: Some artists argue the compensation model does not fairly remunerate creators for their work, as per-stream payments can be very small.
Significance: Spotify's freemium model provides legal access to music without requiring upfront payment, potentially attracting users who might otherwise pirate music due to cost concerns.
Netflix
Netflix Inc. is an internet streaming subscription service for films and television shows (no free tier available).
Launch and impact: Since arriving in Australia in 2015, Netflix has experienced rapid uptake by:
- Providing access to current and popular content
- Allowing viewers to watch when and where they choose
- Offering content previously difficult to access legally in Australia
Evidence of effectiveness: A 2015 Choice survey suggested Netflix was positively affecting piracy rates. However, survey results must be interpreted cautiously as individuals engaged in illegal downloading may not readily admit to such behaviour.
Significance: Netflix and similar services provide consumers with a legal, convenient alternative to piracy. The availability of current content at reasonable subscription costs removes major incentives for illegal downloading.
Agencies and organisations
Multiple organisations contribute to copyright discussion, research, education and policy development in Australia. These bodies represent various stakeholders in the copyright debate.
Commonwealth Attorney-General's Department
Role: Holds primary responsibility for Australia's copyright laws.
Functions:
- Provides information about copyright law to the public
- Works closely with interested groups and organisations
- Manages development and amendment of copyright legislation
Australian Copyright Council (ACC)
Structure: Independent non-profit organisation.
Functions:
- Issues advice and information about Australian copyright law
- Produces publications on copyright issues
- Conducts research into copyright matters
- Makes submissions on copyright policy
Funding: Australian Government and the Australian Council for the Arts.
Music Rights Australia
Former name: Music Industry Piracy Investigations (MIPI).
Functions:
- Represents the music industry's interests
- Provides investigative services
- Enforces copyright on behalf of rights-holders
- Educates the Australian public about music piracy costs
Focus: Highlighting economic impact of music piracy on the industry and artists.
Australian Screen Association
Former name: Australian Federation Against Copyright Theft (AFACT).
Established: 2004.
Functions:
- Protects Australian television and movie industry against copyright theft
- Works with industry stakeholders, government and law enforcement
- Investigates copyright infringement
- Pursues legal action against infringers
Focus: Film and television copyright protection and enforcement.
Electronic Frontiers Australia Inc. (EFA)
Structure: Non-profit national organisation, independent of government.
Represents: Internet users concerned about online freedoms.
Functions:
- Protects and promotes civil liberties online
- Advocates for legal change protecting internet users' rights
- Educates the community about online civil liberties issues
Focus: Freedom of expression in the digital environment and related civil liberties. This organisation often presents perspectives that balance copyright enforcement with user rights and freedoms.
Significance: EFA provides an important counter-perspective to copyright enforcement bodies, ensuring internet users' rights are considered in policy debates.
Remember!
Key points to remember:
- Australia's copyright framework draws from three sources: legislation (primarily Copyright Act 1968), international treaties, and case law
- Copyright protection is automatic in Australia – no registration required if the work meets three criteria: eligible subject matter, original creation, and fixed in tangible form
- The Copyright Act 1968 has been amended four times since 2000 (2000, 2004, 2006, 2015) to address digital copyright challenges
- Three types of 'shifting' are permitted for personal use: space-shifting (device to device), time-shifting (recording broadcasts), and format-shifting (changing formats)
- Major civil cases (Napster, Kazaa, iiNet, Dallas Buyers Club) have established that file-sharing services and potentially ISPs can be liable for facilitating copyright infringement
- Criminal prosecutions for digital copyright infringement can result in fines and imprisonment, with the Griffiths case demonstrating that Australians can be extradited for international copyright offences
- Non-legal responses through market adaptation (iTunes, Spotify, Netflix) may be more effective than litigation alone in reducing piracy by providing convenient, affordable legal alternatives
- Multiple organisations play different roles in the copyright ecosystem, from enforcement (Australian Screen Association, Music Rights Australia) to user rights advocacy (Electronic Frontiers Australia)
Key terms:
- Copyright Act 1968 (Cth) – primary Australian copyright legislation
- Technological protection measures – digital 'locks' preventing unauthorised access or copying
- Space-shifting, time-shifting, format-shifting – three types of permitted personal copying
- Extradition – transfer of accused persons between countries for prosecution
- ISP liability – legal responsibility of Internet Service Providers for customer infringements
Critical frameworks:
- Three requirements for copyright: (1) eligible subject matter, (2) original creation, (3) fixed in tangible form
- Four international treaties: Berne Convention, TRIPS, AUSFTA, WIPO Copyright Treaty
- Two-pronged response to piracy: legal enforcement combined with market adaptation